31st May 2014

SINGAPORE: The government's role in charting the next course of
an environmentally sustainable Singapore involves educating the public,
planning for infrastructure and implementing carefully-studied regulations.

Environment and Water Resources Minister, Dr Vivian Balakrishnan
said that at a focus group discussion on Saturday organised as part of a review
of the Sustainable Singapore Blueprint.

The Blueprint was unveiled in 2009, and contains strategies on
balancing economic growth in an environmentally sustainable manner.

The focus group discussion was attended by some 40 participants,
and is the first of five to six focus group discussions that will take place
between now and July.

To kick things off, participants from non-government
organisations, members of the public as well as the private sector discussed
waste reduction.

“But on the government's side, they need to do the reaching out.
(You need to) reach out to the consumer that in future when you buy a product,
don't look at the size of the packaging, look at the content. Smaller bag does
not mean less content and bigger bag does not equal to more content."

The discussions are set against the backdrop of relatively low
recycling rates in Singapore -- about 61 per cent in Singapore (about 21,500
tonnes a day) and only 20 per cent for households.

Recycling food waste was at an even lower 13 per cent, while the
recycling of plastics is only 11 per cent.

Topics such as creating zero waste and segregating household
waste were discussed on Saturday.

Participants also discussed getting producers to pay for
recycling costs at the end of a product's life cycle, known as Extended
Producer Responsibility (EPR).

That concept has been adopted by countries in Europe, as well as
Japan and South Korea.

But Dr Balakrishnan said it needs more industry consultation in
Singapore.

"I don't think there's a clear consensus here on how
formalised we should be on Extended Producer Responsibility.

“Even if we go to EPR, we have to do it in a way that makes
business sense that it saves money rather than wastes money -- saves money for
producers and saves money for consumers. We need to try and find that formula,”
he said.

Dr Balakrishnan added there must also be sufficient regulations
to level the playing field in favour of responsible companies.

Bank lending
continues to flat-line with only a tiny rise in April over March. A total of
$591.1 billion was lent to consumers and businesses last month - just 0.6 per
cent more than March and similar to the increase registered in March from
February.

Completed
luxury homes without owners are gathering dust in exclusive pockets of the city
centre as developers hold off selling them in a moribund luxury market. In the
Ardmore Park area off Orchard Road, for instance, an entire condominium project
has been completed but not launched for sale. Other projects nearby could soon
face the same fate.

Homebuyers
eyeing the north- east have the upcoming launch of a Kovan condo to look
forward to. Consultants said buying interest in the estate has largely been
from upgraders living in nearby mature Housing Board estates like Serangoon or
Hougang.

Group of
minority owners have lost an appeal to recover $585,370 in costs and expenses
incurred in a series of court hearings that eventually killed the $500 million
Horizon Towers sale. The Court of Appeal on Wednesdayupheld a decision of
High Court Judge Vinodh Coomaraswamy dismissing their claims.

SHARES in GuocoLeisure were again bolstered by speculation that
the hospitality operator controlled by Malaysian tycoon Quek Leng Chan could be
privatised.

The stock jumped by as much as 7.7 per cent in intra-day trading
yesterday to $1.195, before ending at a multi-year closing high of $1.155, up 4
per cent from Thursday.

A share price surge earlier this week prompted a query from
Singapore Exchange. GuocoLeisure responded on Thursday that "it was not
aware of any reasons that could possibly explain the trading in its
securities".

FRASERS
Centrepoint Trust (FCT) has completed the private placement of 88 million new
units at an issue price of $1.835 per unit, raising gross proceeds of about
$161.5 million. This will be used to partly finance the purchase of Changi City
Point.

SINGHAIYI Group has reported net profit of $23.15 million for the
fiscal year ended March 31, 2014, up sharply from $1.68 million in the previous
financial year.

Revenue more than trebled to $56.95 million from $17.02 million,
on the back of higher property development income, comprising contributions
from Charlton Residences and sales of completed units from its project in the
US, Vietnam Town.

Other income jumped to $39.28 million from $4.37 million, helped
by fair value changes on investment properties and gain on bargain purchase.

Cities have
been the crucible of politics, economics, society and culture down the ages.
Unprecedented urbanisation, now overwhelmingly outside the West, makes them
even more important. Cities come in various shapes and sizes. One type is the
"global city"; membership is extremely limited.

WORLD travellers looking for a cheap place to stay may want to
avoid Geneva, Dubai and Miami.

The three cities rank among the most expensive markets for hotel
rooms, according to an index compiled by Bloomberg. In Geneva, the average cost
for a night is US$308, followed by Dubai at US$273, Kuwait City at US$253 and
Zurich at US$250. Miami is next as the costliest place for lodging in the US,
at US$245 a night.

Room costs are pushed up in high barrier-to-entry markets where
developable land is scarce and the number of hotels limited, as well as by a
relatively affluent customer base. In cities such as Edinburgh, which ranks
above London, a limited supply of lower-end rooms pushes up expenses for
visitors.

-From Los Angeles, US

Geneva, Dubai Rank as Priciest Cities in World for Hotels

Source: Bloomberg / Luxury

World travelers looking for a cheap place to stay may want to avoid Geneva, Dubai and Miami.

The three cities rank among the most expensive markets for hotel rooms, according to an index compiled by Bloomberg. In Geneva, the average cost for a night is $308, followed by Dubai at $273, Kuwait City at $253 and Zurich at $250. Miami is next as the costliest place for lodging in the U.S., at $245 a night.

Room costs are pushed up in high barrier-to-entry markets where developable land is scarce and the number of hotels limited, as well as by a relatively affluent customer base. In cities such as Edinburgh, which ranks above London, a limited supply of lower-end rooms pushes up expenses for visitors.

“What it comes down to is the cost of real estate and the availability of hotel rooms,” said Nikhil Bhalla, a lodging analyst at FBR & Co. in Arlington, Virginia. “Geneva, as many of the major cities in the world, is land constrained. The cost of development in Switzerland is probably among the highest in the world in part because of the beautiful scenery.”

Geneva is 32 percent more expensive than New York and London and 28 percent costlier than Hong Kong, according to relative index values.

Geneva also topped the list for five-star hotels, which are luxury properties that include such amenities as a spa, full-service health club and signature golf course. In that category, a room in the Swiss city costs an average of $614 a night, according to the index.

Los Angeles is No. 2 for the highest-end properties, averaging $481 a night, followed by Tokyo at $440. The five-star ranking includes cities with at least 10 hotels available for booking in that category.

International Hub

The large presence of international organizations in Geneva helps buoy hotel rates, particularly at the highest end, according to Jan Freitag, senior vice president at Hendersonville, Tennessee-based research firm STR Inc. The United Nations and the World Health Organization have large offices in the city.

“Geneva is very expensive because of all the international organizations and the ancillary businesses in the city,” Freitag said in a telephone interview. “These people don’t tend to pay for themselves and that means they can stay at very high-end properties.”

Among European markets outside of Switzerland, a hotel room in Edinburgh costs an average of $241 a night, compared with $235 in London. Paris is next at $232.

Hong Kong leads the Asia-Pacific region and is No. 6 in the world, with an average $242 nightly rate. Singapore follows at $235 a night.

Collins Avenue

In the U.S., a room in Miami is more expensive than in New York, which averages $233 a night, and San Francisco, at $211, according to the Bloomberg index. Miami’s market is boosted by Collins Avenue, which runs along the beach and features trendy nightclubs and hotels including the Setai Miami Beach, Delano Hotel and the Canyon Ranch Hotel & Spa.

“Collins Avenue is by far the core hotel market in Miami,” Bhalla said. “But there aren’t a lot of places at the beach you can still develop on a larger scale.”

Increases in New York hotel rates have slowed because of an influx of new properties in the city, Bhalla said. Since 2006, New York has added 74 hotels and more than 13,500 rooms, according to NYC & Co., the city’s marketing and tourism website. The city has more than 92,000 rooms in its inventory, and will add more than 15,000 in the next three years, it said.

The Bloomberg gauge measures 106 cities. Globally, the cheapest market is Hanoi, where an average room is $62.

Rate calculations were taken for two blocks of time -- Aug. 1 to Aug. 10 of this year and Feb. 1 to Feb. 10, 2015 -- to account for holiday, promotion and convention-related pricing.

SL Green Realty Corp. (SLG) is proceeding with a plan to build a skyscraper next to New York’s Grand Central Terminal that will be taller than the nearby Chrysler Building after the city proposed new zoning for the area.

SL Green will probably be the first applicant for a special zoning permit in the area, and its plans for the 1,200-foot (370-meter) tower should be under public review in the last three months of the year, New York Mayor Bill de Blasio said today in a statement. The rezoning of a five-block area mostly along Vanderbilt Avenue is part of a “two-track” strategy to rezone the eastern portion of midtown Manhattan, he said.

De Blasio last year promised to revisit former Mayor Michael Bloomberg’s proposal to rezone 73 blocks of east Midtown for taller buildings. The city council blocked the measure last year on concerns that plans to upgrade the area’s transportation and relieve pressure on crowded sidewalks were inadequate, and that provisions to sell air rights were mispriced.

The Real Estate Board of New York denounced that decision as costly to the city because it holds back development in a major commercial area. The former mayor is the founder and majority owner of Bloomberg News parent Bloomberg LP.

De Blasio said today that “ground-up planning” will “lay the groundwork to keep districts like east Midtown thriving and attracting new businesses for decades to come.”

Pedestrian Mall

The plan would turn the block between East 42nd and 43rd streets into a pedestrian mall. SL Green’s One Vanderbilt tower -- on a side street just west of Grand Central -- would include a public room at street level that would serve as a western extension of the terminal, with its own train board, Jeremy Soffin, an SL Green spokesman, said in a phone interview.

“We will be moving forward with our plans for One Vanderbilt, a new world-class office tower that is already attracting attention from major tenants desiring modern space in the heart of Midtown,” SL Green Chief Executive Officer Marc Holliday said in the mayor’s statement.

Canada’s Toronto-Dominion Bank, whose TD Bank division has several New York branches, is in negotiations to be the anchor tenant at the tower, the Wall Street Journal reported on May 22. Soffin said SL Green, New York’s biggest office landlord, had no comment on those discussions.

Manhattan condominium prices fell in April by the most in more than three years, a sign the market is slowing during the busiest selling season.

Sale prices for previously owned units dropped 1.4 percent from March, the biggest decline since September 2010, after four consecutive monthly increases, according to a report today by real estate website StreetEasy.com. Condo prices are likely to be little changed through the spring, rising 0.1 percent in May, StreetEasy projected.

Purchases and prices typically rise during the second quarter, traditionally an active time for New York real estate. Contracts to buy condos in April dropped 3.2 percent from the previous month and almost 14 percent from a year earlier, signaling that buyer appetites have cooled after competition for tight inventories pushed up values, according to StreetEasy.

“After a record-breaking finish to 2013 and beginning to 2014, we may have approached the upper price limit to where buyers are willing or able to meet sellers,” Alan Lightfeldt, a data analyst at New York-based StreetEasy, said in the report.

In the first quarter, the median condo sale price jumped 17 percent from a year earlier, the biggest increase since the height of the market in 2008, according to StreetEasy, which is owned by Zillow Inc.

Condo sale prices in April were up 13 percent from a year earlier, according to today’s report.

Escalating values have spurred more listings as Manhattan apartment owners seek to profit from surging demand. Inventory increased 3.6 percent in April, the fourth consecutive monthly gain, StreetEasy said. Of the available condos for sale, almost half were priced at $1.9 million or more.

Australand Property Group (ALZ)shares had the biggest gain in 10 weeks in Sydney trading after agreeing to open its books to bidder Stockland (SGP)and increasing its earnings outlook for the year ending Dec. 31.

The company’s shares rose 2.1 percent to A$4.29 at the close of trading in Sydney, the biggest gain since March 21. Stockland shares rose 0.3 percent to A$3.90, while the benchmark S&P/ASX 200 (AS51) index fell 0.5 percent.

Australand will provide Stockland access to due diligence materials, the Sydney-based property company said in a regulatory filing today, after receiving a sweetened takeover bid from Australia’s biggest diversified real estate trust this week. Earnings per share for 2014 are expected to increase by as much as 25 percent, compared with previous guidance of 17 percent to 20 percent growth, it said.

Stockland made an all-share offer equivalent to A$4.35 a share on May 28, after the target on April 23 rejected an earlier bid that equated to A$4.20 a share at the time.

Australand “will engage with Stockland to negotiate access to due diligence including the provision of reciprocal due diligence in order for the board to form a view on the merits of the proposal,” Australand said in today’s statement.

Shares of Westfield Retail Trust (WRT), the shopping center operator managed by Australia’s biggest mall owner, dropped the most in a month after a vote to merge with Westfield Group’s local business was postponed.

The stock slid as much as 1.9 percent, the biggest decline since April 28, before trading down 0.3 percent at A$3.23 as of 11:30 a.m. in Sydney. Westfield Retail yesterday deferred a shareholder vote on the restructure after Frank Lowy, Westfield Group’s billionaire founder, said he would press on with a plan to split its domestic and global businesses with or without the retail trust’s support.

The proposal to create Scentre Group to own and manage the Australian and New Zealand businesses, and Westfield Corp. to run its global operations, received the support of 74 percent of Westfield Retail proxies before the vote was deferred.

The board of Westfield Retail postponed the vote, saying that Lowy’s comments materially changed the outlook for shareholders.

About 98 percent of Westfield Group (WDC) shareholders voted for the proposal. The company needs the support of 75 percent of investors in both groups for the plan to proceed.

“Westfield Retail is paying too high a price for the operating platform,” Stephen Mayne, a spokesman for the Australian Shareholders’ Association, whose members together hold more than A$20 million of Westfield Group shares and A$10 million of Westfield Retail securities, said yesterday. “And it’s being taken up the risk curve with a lot more debt.”

Westfield Group shares were unchanged at A$10.85, and were up 7.6 percent this year. The benchmark S&P/ASX 200 Index lost 0.2 percent today. Both Westfield Group and Westfield Retail Trust were suspended from trading yesterday.

This was supposed to be the year that U.S. mortgage rates soared. Instead, they’re retreating.

Interest rates unexpectedly fell this year after the Federal Reserve began scaling back the stimulus that held borrowing costs near record lows since 2011. After five weeks of declines, rates for 30-year fixed loans are at 4.12 percent, the lowest in seven months, Freddie Mac said yesterday.

The housing market, in the season that’s traditionally its busiest, can use the help, even if it’s short-lived. Soaring home prices and a one percentage point spike in rates from May to August last year cut into affordability and slowed the real estate recovery. While the falling borrowing costs have forced economists at the National Association of Realtors and Moody’s Analytics Inc. to lower forecasts, they still expect 30-year rates to lurch closer to 5 percent by the end of the year.

“It’s a temporary window of opportunity for buyers in that a year from now rates will be higher,” said Mark Zandi, chief economist for Moody’s Analytics in West Chester, Pennsylvania. “The housing market could use it given how it’s gone sideways. But I wouldn’t count on these low rates for very long.”

The decline in borrowing costs has so far done little to spur sales, which have been weighed down by tight credit and lower-than-normal inventory levels. Contracts to buy previously owned houses in the U.S. increased 0.4 percent in April, less than economists estimated. They fell 9.2 percent from a year earlier, the National Association of Realtors said yesterday.

Loan applications for home purchases were down 15 percent last week from the same period a year earlier, according to a Mortgage Bankers Association index.

Credit Hurdle

“Those who can qualify for credit and expect rates to increase will jump in, but the biggest hurdle to homeownership is getting credit and standards are still very tight,” said Anika Khan, a senior economist at Wells Fargo Securities LLC in Charlotte, North Carolina. The decline in borrowing costs is more likely to spur buyers of cheaper homes, yet more purchases have been of pricier homes, she said.

Purchases costing $1 million or more rose 7.8 percent in March from a year earlier, according to data from the National Association of Realtors last month. Transactions for $250,000 or less, which represent almost two-thirds of the market, plunged 12 percent in the period.

Buyers in March paid 12.4 percent more for homes compared with a year earlier, according to the S&P/Case-Shiller index of 20 cities. And mortgage rates are well above year-ago levels. Rates spiked from a near record low of 3.59 percent last May around the time that the Fed chairman said that the central bank would start tapering its bond-buying program as the economy improved.

Originations Fall

The higher rates killed the wave of refinancing, shrinking the mortgage market. While the Fed has begun tapering, rates have continued to fall because, in part, its mortgage-backed securities purchases now make up a larger share of a smaller market, said Nela Richardson, chief economist for Redfin Corp., a Seattle-based brokerage firm.

The Fed bought 62 percent of newly issued government-sponsored mortgage-backed securities in April, up from 43 percent a year earlier, according to data from Freddie Mac. The monthly volume of new securities dropped to about $67 billion from almost $153 billion a year earlier.

Mortgage originations in the first quarter declined 58 percent from a year earlier to $235 billion, the lowest in 14 years, according to Inside Mortgage Finance. Refinancings made up about 44 percent of the market, compared with 78 percent a year earlier.

Inflection Point

“Eventually the Fed tapering will outpace the supply of mortgage originations, but it hasn’t happened yet,” Richardson said. “Until that inflection point, the Fed will be the biggest elephant in the room and that will keep mortgage rates low.”

Investors overreacted a year ago to the Fed’s decision to slow bond purchases, and the market is now adjusting to reality, said Guy Cecala, publisher of Inside Mortgage Finance.

“To some extent, the drop in rates we’ve seen is loosening of panic and recognition that the Fed’s share of new mortgage-securities production is the same as it was before it began tapering,” Cecala said. “As long as the economy stays in neutral or first gear, we’re not going to see much upward pressure on interest rates.”

The turmoil in Ukraine, coupled with the expectation that the European Central Bank will reduce rates and be more accommodative in June, is driving investors to “safe-haven” buying and keeping mortgage rates low, said Erin Lantz, vice president of mortgages at Zillow Inc.

‘More Demand’

“The recent dip down is really more a reaction to the market perception that the economic data out of Europe is weaker than expected,” Lantz said. “U.S. mortgage-backed securities are one of the more stable and secure asset classes, so when there’s instability, there’s more demand for them, which drives down rates.”

The National Association of Realtors and Moody’s Analytics both lowered their 2014 forecasts for 30-year loan rates to 4.5 percent. Capital Economics, which reduced its projection this month, said rates will climb to 4.75 percent by the end of the year. The Mortgage Bankers Association expects them to reach 5 percent this year and 5.3 percent next year.

Khan of Wells Fargo is predicting the 30-year fixed rate will be 5.4 percent by 2015 as gross domestic product growth reaches 3 percent and inflation settles around 2 percent.

“The data so far has been backward-looking and tied to the weather,” Khan said. “As we start to get into June, we should start to see a different economic story coming out.”

While financing costs are lower than they were a few months ago, rising prices have made homes less affordable for first-time buyers, said Jed Kolko, chief economist at San Francisco-based property-listings service Trulia Inc. (TRLA) Looser credit would play a bigger role in driving sales, he said.

“If we see an increase in sales, it’s more likely to be trade-up buyers,” Kolko said. “The window of opportunity to buy cheap ended early last year before mortgage rates spiked.”

Deutsche Bank AG (DBK), Europe’s biggest investment bank, bought a portfolio of Irish rental homes from Danske Bank A/S (DANSKE) as the Danish lender pulls back from the country, two people familiar with the matter said.

Danske Bank, based in Copenhagen, agreed this week to sell 680 homes to Frankfurt-based Deutsche Bank, said the people, who declined to be identified because the details aren’t yet public. Danske seized the properties after the owners, who bought them as investments, fell behind with mortgage payments.

Donnchadh O’Leary, a Danske spokesman who works for Edelman in Dublin, confirmed the portfolio had been sold, without naming the buyer or the price. A Deutsche spokesman in London wouldn’t comment on the purchase.

Some of the world’s biggest financial firms are wagering on a rebound in the Irish property market as the country recovers from the biggest real estate crash in Western Europe. The German lender said this month that it’s raising 8 billion euros ($10.9 billion) in capital, partly to help its fixed-income business grab market share.

“Some of this new capital will undoubtedly be put to work in areas such as this in a bid to boost returns,” said Mediobanca SpA analyst Christopher Wheeler, who has a neutral rating on Deutsche Bank’s shares. “They’ve got a new confidence and a new direction.”

Acquistions such as the Danske Bank portfolio may require the lender to set aside more capital compared with other assets to protect against possible losses, according to Wheeler.

Special Situations

Deutsche Bank bought the properties through its structured credit business, according to one of the people. The division focuses on “illiquid credit, securitisations, hard-asset financing and special solutions,” according to its website.

Buy-to-let homes are among the most distressed Irish property assets. About 27 percent of 145,530 buy-to-let mortgages outstanding at the end of 2013 were in arrears, according to the Ireland’s central bank.

“The decision to sell the properties as a portfolio reflects our decision to strategically manage down the non-core portfolio in Ireland,” Peter Hughes, head of Danske Bank’s non-core Irish assets, said. “We’re pleased with the outcome which reflects increasing investor confidence in the property market in recent months.”

About 60 percent of the properties are in Dublin and the rest are across Ireland. Many of the properties are vacant and there are no so-called principal private residences in the portfolio, Danske Bank said in a statement.

Some signs are emerging of a recovery in Ireland. Dublin homes gained 3.1 percent in April, the biggest gain in six months, and 18 percent compared with the same period in 2013, Ireland’s central statistics office said this week.